Sunday, September 16, 2018

CoA bares NHA housing loans irregularities

Commission on Audit and National Housing Authority logo / image from Google

Manila, Philippines -A P2.3 billion total amounts of loans financed
by the National Housing Authority (NHA) for the military, police, and informal
settler families living in danger areas were not supported by Individual Loan
Agreement (ILA), says the state auditors.

This findings was stated by Commission on Audit’s (CoA) in
its Audit Report on the NHA for 2016 and 2017.

“Loans in the total amount of P2.358 billion were not
supported by [ILA] contrary to Section 4.6 of PD 1445, Section 7.6 of the TOR
for Armed Forces of the Philippines/Philippine National Police (AFP/PNP)
Housing Program, Section 5.4 of Memorandum Circulars (MCs) 2518 and 2518-A for
Informal Settler Families (ISFs) Living in Danger Areas, and Sections 2.1 and
2.3, Article II of the tripartite MOA [memorandum of agreement],” CoA said.

An ILA serves as the identified beneficiaries’ commitment to
pay the NHA in return for house and lot packages acquisition.

COA cited that as of December 31, 2017, there are a P4.6
billion total of recorded loan receivables subsidized by NHA for 20 housing
projects for the AFP, PNP and Informal Settler Families (ISFs) but 51 percent
of the amount were not supported by ILA.

It was recommended by COA that developers should be required
to strictly comply with the requirement on the submission of ILA.

The state auditor gives military and police until June 30,
2017 to submit the revised list of the names of the beneficiaries. However, the
Housing Board had not yet finalized the list as of February 2018.

Furthermore, the same report showed that the technical and
financial capacity of developers to undertake 28 projects costing P10.62
billion was insufficiently evaluated.*

The annual report states that developers are not technically
and financially capable to undertake such housing projects as manifested by deficiencies
in documents submitted and failure to comply by developers to some
requirements.

“Verification of the documents of selected developers who
were awarded the contracts for the provision of house and lot packages for
various housing projects showed that the developers are not technically and
financially capable to undertake the housing projects. These are manifested by
the deficiencies in the documents submitted and non-compliance to some
requirements by the Developers on the evaluation of the financial capacity as
follows,” CoA said.

Non-disclosure of contract cost and client/owner on the list
of ongoing projects, awarding projects to certain developers that exceeded their
license, and non-evaluation of developers’ financial capacity – were among the
cited irregularities in the said audit report.

“Hence, there are no basis for the assessment of the
financial capacity of the Developer to undertake individual or multiple housing
projects that involve substantial amounts for the same contract period to a
single Developer,” auditors said.

“The inadequate evaluation of the Developers’ capacity to
undertake the project were later on manifested in the delayed completion of the
housing projects,” the COA added